February 10, 1997

Commercial Use of Spy Satellites to Begin; Private Ventures Hope for Profits

By WILLIAM J. BROAD

Commercial spy satellites are about to let anyone with a credit
card peer down from the heavens into the compounds of dictators or
the backyards of neighbors with high fences.

The first satellite is scheduled to fly into orbit in April or
May, another in December and perhaps a dozen in all during the next
decade. The launchings will end a monopoly that advanced nations
held for nearly four decades on orbital espionage.

Rivaling military spy craft in the sharpness of their photos,
the new American-made satellites are designed to see objects on the
ground as small as a yard or so in diameter -- cars and hot tubs,
for example.

While the new craft pose knotty security and privacy questions,
their builders tend to play down such issues and instead pledge to
aid cartography, law enforcement, oil exploration, disaster relief
and urban planning, among other things.

"The possibilities are endless," says a brochure from
Earthwatch Inc. of Longmont, Colo., which is first in line to send
up the new satellites. "Vacationers will plan exotic sailing
cruises along foreign coasts. Small retail businesses will have a
better understanding of demographics."

Images are expected to cost as little as a few hundred dollars
each, depending on whether an order can be filled from company
archives or requires a satellite to turn a camera on a new part of
the Earth.

The Clinton administration approved this commercial use of spy
technology in 1994 to help aerospace companies facing post-Cold-War
contractions and to challenge foreign rivals in the emerging
industry of civilian surveillance from space. Today, much of the
American activity involves gear and contractors that once were, or
still are, part of the sprawling government complex for military
espionage, as well as former federal officials.

While federal and private experts have quietly discussed the
shift for years, the actual debut of a fleet of commercial spy
satellites is expected to prompt wide debate over the new
industry's promise and peril for nations and individuals.

"The biggest market for this information is going to be foreign
governments that can't afford their own reconnaissance systems,"
said Albert Wheelon, the former CIA official who helped shape the
nation's early spy-satellite program.

"The issue is going to heat up the first time we get a real
crunch between two friends, like Pakistan and India," he added.
"Right now, we have an incomplete policy. I don't think the
government thought through the issues thoroughly enough."

Analysts say the implications of the shift will probably take
decades to sort out politically, militarily and perhaps legally, in
court cases involving possible invasions of privacy.

Over all, they add, the subject is exceedingly complex and ill
suited to blanket condemnation or praise.

"It's bad because it's going to give countries like Libya and
North Korea reconnaissance capabilities like those of the United
States," said John Pike, head of space policy at the Federation of
American Scientists, a private group in Washington. "But it's good
because it's going to significantly improve the ability of citizens
to monitor governments."

Federal officials say that the risks and benefits were carefully
weighed before the 1994 decision and that economic gains will
offset military or diplomatic losses. A vibrant economy, they say,
is one of the most important elements of national security.

To date, the Commerce Department, which coordinates control of
the private work, has issued licenses to nine U.S. companies, some
with foreign partners, for 11 different classes of satellites,
which have a range of reconnaissance powers.

The total number of spy-class satellites that will reach orbit
is hard to predict, but experts say at least a half-dozen are
likely to debut in the next two or three years.

"Soon these won't just be applications on paper," said Michael
Mignogno, head of licensing coordination at the Commerce
Department. "They'll be real assets in the sky."

Makers of the satellites say the market for space photos might
eventually reach billions of dollars annually. And contrary to
critics who worry about aiding war, they say the field is likely to
bring about a new age of peacefulness.

"We have a chance to change the world," said Douglas Gerrull,
president of Earthwatch, which has four satellites in the works.
"The basic premise is that the more people know, the safer we are.
Dictators will realize they can't move their troops without
somebody knowing about it."

Military spying from orbit began in 1960, when the United States
launched the world's first reconnaissance satellite. Over the
decades, only a few countries have had the wealth and skill to
achieve their own espionage from the high ground of space.

The photographs were fuzzy at first but grew increasingly sharp,
until they could reveal objects at least as small as a football.

The visual power of spy craft is usually expressed as the
length, in meters, of the smallest feature that analysts can see
when photo processing is pushed to the limit. For a camera that can
show a football, the resolution is about one foot, or one-third of
a meter.

In the early 1970s, the National Aeronautics and Space
Administration launched a civil satellite known as Landsat, the
first to near the military's surveillance realm. With a resolution
of about 100 meters, or about 325 feet, its cameras were able to
show things no smaller than wheat fields, ice floes and general
land formations.

The Landsats evolved to show images of features as small as 30
meters, or about 97 feet. But the Defense Department blocked
further progress as a threat to national security.

In the mid-1980s, the French government moved to the edge of the
espionage realm with its civilian Spot satellites, which had a
resolution of 10 meters, about 32 feet, and could aid urban
planning and the reconnaissance of large military targets, like
warships.

In 1987, Moscow began selling photos with a resolution of five
meters. The imagery, from spy operations, was limited
geographically and badly out of date. But it prompted fears in
Washington of foreign rivals.

In 1992, the Russians raised the ante by beginning to sell old
imagery with a resolution of two meters -- good enough to see
planes, tanks and troop movements.

The Bush administration responded by easing American regulatory
barriers. In early 1993, it granted a license for a commercial
craft with three-meter resolution.

The Clinton administration's 1994 decision was the most dramatic
step, giving the go-ahead for craft with a resolution of slightly
less than one meter, images unambiguously in the heart of the spy
zone.

Today, the rules let American companies photograph anything from
space and sell the fresh imagery on the open market. But the
government retains the right to switch off their cameras in time of
war or international tensions, a plan known as shutter control.

The federal government also has the right to screen and limit
the American companies' foreign customers. Nations likely to be
denied access to the imagery include Iraq, Libya, Cuba and North
Korea. But private experts say front companies will probably evade
export prohibitions, as they have repeatedly done for atomic,
chemical, biological and missile technologies.

Today the change of federal policy is aiding some of the
Pentagon's most experienced contractors. For instance, Eastman
Kodak Co., a key maker of cameras for government espionage, is hard
at work for the commercial spy companies as well.

In the vanguard of the new industry is Earthwatch. With about
200 employees, it is building two satellites with three-meter
resolution, and two with one-meter resolution. The first is to soar
aloft from Siberia in April or May, atop a Russian rocket. Its
corporate partners include Ball Aerospace and Technologies Group,
owned by the Ball Corp., and Hitachi Ltd. of Japan.

Earthwatch draws on the innovations of the Pentagon's
anti-missile program, which has spent more than $30 billion to find
ways to spot and destroy rising rockets and warheads from space.

The giant of the fledgling field is Space Imaging, based in
Thornton, Colo. The private company is owned by the Lockheed Martin
Corp., which makes many of the military's spy satellites, and
E-Systems Inc., a unit of the Raytheon Co. that provides many of
their communication links.

Space Imaging is building two satellites with one-meter
resolution, the first of which is scheduled to blast skyward on an
American rocket in December from California.

The president of Space Imaging is Jeffrey Harris, who from 1994
to 1996 directed the National Reconnaissance Office, the secretive
federal group that builds and runs the government's spy satellites.

"I'm confident we're on a path to being quite successful," he
said in an interview.

Other companies pursuing the work include the Boeing Co.,
Motorola Inc. and the Orbital Sciences Corp., a company in Dulles,
Va., that wants to have a one-meter satellite aloft by 1999.

The initiatives have sparked rival efforts beyond American
business. For instance, NASA is preparing to send up two
reconnaissance satellites -- Lewis, with five-meter resolution, and
Clark, with three-meter resolution. NASA plans to share the imagery
with American students.

And foreign governments with the wherewithal are scrambling to
enter the commercial fray. The Indian government last year began
selling five-meter imagery, currently the best that is timely. By
1999, it hopes to have a satellite that will yield 2.5-meter
imagery.

"The genie is out of the bottle," said Christopher Simpson, an
expert on space reconnaissance at American University in
Washington. In March, he plans to hold a conference on how news and
nongovernmental organizations can use the imagery.

Wheelon, who was the CIA's deputy director for science and
technology in the 1960s, said the new trend threatened to lessen
the value of the diplomatic currency of military spy photos, which
the United States shares with such allies as Australia, Canada,
Israel and Britain.

And, he said, governmental shutter control over the new cameras
would most likely prove awkward or futile because Washington would
be unlikely to always know ahead of time when censorship might be
in the best interests of the United States.

So too, civil libertarians foresee knotty problems. They say
that courts weighing aerial-photography cases have steadily eroded
privacy protections and that the new technologies threaten to
further the trend.

But many experts say the new surveillance age, though laden with
problems, is probably good over all because it plays to American
strengths and against totalitarian governments.

"We fought the Cold War to prove that open-information
societies are better than closed ones," said Joanne Gabrynowicz, a
lawyer in space policy studies at the University of North Dakota in
Grand Forks. "We can't stop now."